The firm behind a controversial housing scheme is bidding to avoid paying more than £9m to Blackpool Council which was agreed as part of the development.
When Lytham-based Kensington Developments was granted planning permission to build 584 homes on Marton Moss, part of the agreement included a £9.14m contribution by the building firm towards affordable housing in the borough.
The money had been earmarked for regeneration of the resort’s inner areas.
But now the company says falling house prices and rising building costs mean it is no longer financially viable for it to pay up.
Blackpool Council’s planning committee approved the application for land on Moss House Road in 2010 despite huge opposition from residents angry at the loss of green land.
However the £9m payment as a commuted sum in compensation for the loss of the open space was seen as a major consideration in favour of the plans.
Kensington is also seeking to rescind a payment of £1.6m due as part of the planning permission granted last year for 83 houses on land at Runnell Farm, off Midgeland Road.
Both payments are part of ‘106 Agreements’ which previously could not be altered until at least five years had passed, by which time the planning consent may have expired anyway.
But new planning legislation introduced in April means developers can now apply to vary or remove the agreements earlier.
The move was introduced because the Government wants to remove barriers to house-building.
But Blackpool Council wants the agreements to stand and a public inquiry into the issue will now be held at the town hall on January 7 and 8.
Coun Gillian Campbell, Blackpool Council cabinet member for housing, said: “We confirm the developer has lodged appeals against having to pay affordable housing contributions as part of the Moss House Road and Runnell Farm developments.
“Blackpool Council will strongly contest the appeal.
“We believe we have already been more than reasonable in agreeing to backload the schedule of payments towards the end of the schemes to help unlock the development.
“Everybody knows we need new affordable housing in Blackpool and we believe the developer should honour its obligations to Blackpool and its residents.”
The council appointed independent consultants URS to carry out an appraisal which concluded the Moss House Road site “can bear” the costs.
Angelia Hinds, of the Save the Moss campaign, which protested against the Moss House Road development, branded the move to avoid the payments as “immoral”.
She said: “If they aren’t going to pay the money either the development has to change to include the affordable housing within it, or they should be told they cannot go ahead with it at all.
“The vast majority of the payments were due towards the end of the scheme anyway.
“So to turn round now and say they don’t want to pay any of the money is a kick in the teeth to those who have bent over backwards to help the developers, and to those wanting to regenerate the inner areas of Blackpool.
“It is almost immoral.”
Blackpool South MP Gordon Marsden, who also opposed the scheme, said: “Kensington Developments now has the nerve to want to be let off making any contribution to affordable housing in Blackpool whatsoever.
“This should be opposed with every power the council has. To remove £9m of their contribution to affordable housing in Blackpool on a project that was only agreed on that basis, would be a gross breach of trust and very damaging to the council’s excellent intention to promote affordable housing elsewhere in the borough. If Kensington feel that without a subsidy they won’t go ahead with the scheme, many people would not feel sorry about it.
“This is a development that I think environmentally and in terms of saleability, is not fit for purpose for Blackpool.”
Coun Peter Callow, who was council leader at the time the scheme was approved, said: “I think it is all wrong if Kensington does not have to pay this sum of money.
“The changes to the rules on 106 Agreements should not be retrospective. If Kensington does not have to pay it, they will be cheating the people of Blackpool.”
The Moss House Road scheme first sparked controversy when Kensington made a £10,000 donation to the Blackpool South Conservative Association ahead of the 2010 General Election, which was later repaid following an investigation.
Kensington Developments said they did not wish to comment on their application to rescind the 106 agreements.
Developer makes same move in Fylde
Kensington Developments has also applied to Fylde Council to remove the affordable housing element of its housing scheme at Queensway, St Annes.
A public inquiry will be held in the new year but no date has yet been set.
While Kensington’s agreement with Blackpool Council is for payment in lieu of housing, the planning permission for Queensway requires 10 per cent of the site to be affordable homes.
This amounts to 115 houses out of the total 1,150 which there is outline planning permission for.
Fylde Council’s head of planning and regeneration Mark Evans said: “Kensington has made an application to completely remove affordable housing from the scheme and that will be the subject of an appeal.”
The council has not yet decided if it will oppose the application.
Kensington won planning permission to build on Queensway following an appeal.
The affordable homes quota was a condition of the planning permission being granted.